In France, the price of a computer is 1,227.6 euros. In Japan, the price of the same computer is 137,920 yen. If a U.S. dollar can buy 1.023 euros or 119.93 yen, then purchasing power parity
)
A) is equal to interest rate parity and the computer is cheaper in North America
B) does not hold and the computer is cheaper in Japan
C) does not hold and the computer is cheaper in France
D) holds and the computer is the same price everywhere
Correct Answer:
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